Things you need to know about ① Megabanks

The three Megabanks in Japan are Mitsubishi UFJ Bank, Sumitomo Mitsui Banking Corporation, and Mizuho Bank.
In addition, Shinsei Bank, Resona Bank, and Aozora Bank may also be included.
One of the characteristics of these banks is that they have ample financial resources, so their mortgage interest rates are relatively low compared to other banks.
Another feature is the generous life and fire insurance coverage that comes with the mortgage.
There are products that offer discounts for three major diseases, seven major diseases, and fire insurance.
This insurance coverage is only available when a loan is taken out, so it is also recommended for those who wish to consider total coverage including insurance.

Those for whom megabanks are suitable

If you are not knowledgeable about mortgages and prefer face-to-face consultations, megabanks are the right choice for you.
Basically, they have branches nationwide, so even if you change jobs or are transferred out of the prefecture, you can go directly to the counter for consultation.
Those who work for major companies, have high income, or are public servants are suited to megabanks because they are more likely to receive preferential treatment, such as relatively low interest rates, when they take out a mortgage loan with a megabank.
Megabanks have a low risk of bankruptcy because they are well managed.
They are recommended for those who want to receive stable services and borrow a mortgage loan from a financial institution with a high credit rating.

Those for whom Megabanks are not suitable

Megabanks have branches nationwide, so even if you change jobs or are transferred out of the prefecture, you can still go to the counter.
However, in rural areas far from urban centers, there may be no branches or ATMs.
If you originally lived in Tokyo but now live in a rural area, you may not be able to go to a megabank or ATM easily.
In that case, you will need to go to the city center, so if you find it troublesome, this service is not suitable for you.
Naturally, it is also difficult to get a loan from a megabank if you are a sole proprietor and have excessive taxation practices or have done something in the past that would result in a negative evaluation with regard to screening.

Things you need to know about ② Regional banks

One of the characteristics of regional banks is that they are small and flexible.
Compared to megabanks, regional banks are different in size and financial strength, so they are forced to charge higher interest rates if they take on the same risk.
Instead, they are characterized by their local presence, small turnaround, and aggressive lending.
In addition, since they have many branches in the local area, people living in the area can easily visit the counter.
Many people may feel that the psychological hurdle is lower than with megabanks, as regional banks have a sense of familiarity.
In order to differentiate themselves from others, regional banks offer generous services that are unique to regional banks, and they also offer flexible support for mortgage consultations.

Those for whom Regional banks are more suitable

Regional banks have many branches in their local communities and operate with close ties to the community.
Those who were born and raised in the area will be familiar with them from a young age.
This sense of familiarity is important for first-time mortgage borrowers.
If you would like to consult with a local bank in a familiar place in a casual manner, a regional bank is the right choice for you.
In some cases, a local bank may have someone you know who works there.
In other cases, you may be introduced to a banker by a family member or acquaintance.
Many of the people who work at regional banks are bankers who were born and raised in their hometowns.
This can lead to a natural connection with a local banker.
This may also be suitable for those who know someone or feel more comfortable with an introduction.
Regional banks, like many financial institutions, offer financial products such as insurance, accumulated NISA, and iDeCo.
You can also consult with them face-to-face about matters other than loans.
Financial institutions are money professionals.
If you want to consult with them about money matters as well as mortgages, a regional bank is the right choice for you.

Those for whom Regional Banks are not suitable

Regional banks do not have branches or ATMs in all parts of the country.
For those who may be changing jobs or relocating out of the prefecture, megabanks and Internet banks are probably better suited.
Among the financial institutions mentioned in this article, interest rates at regional banks are higher.
Therefore, they are not suitable for those who are concerned only with interest rates.
However, it is possible to lower the interest rate depending on your attributes and negotiations, so it is worth consulting with them.
And compared to megabanks, regional banks are somewhat less stable.
Regional banks are linked to the local economy, so if the local economy is not vibrant, it will affect the regional banks as well.
If you want to get a loan at a big, stable place, a megabank may be a better choice.

Things you need to know about ③　Online banks

The most important feature of online banks is their low interest rates.
Since applications are completed only online, personnel and branch costs can be reduced, which in turn lowers the interest rate.
Some online banks have branches, but most of them conduct transactions mainly on the Internet.
Some banks take a long time to screen applications, and some do not support bridge loans.

Those for whom Online banks are suitable

One of the most important features of online banks is their low interest rates.
The interest rate can be set lower because personnel and branch costs are less than those of other financial institutions.
In any case, if you want to get a low interest rate for your mortgage, an online bank is suitable for you.
If you are too busy with work during the weekdays and cannot take time to visit a financial institution, an online bank is suitable for you.
We recommend this service because it is completed online, and you can proceed with the procedure at your convenience from your home computer.
Online banking is also suitable for those who can make their own informed decisions from the Internet and are not bothered by research.
You may feel that many procedures of online banking are difficult because you have to do them by yourself, but the interest rate can be reduced because of that.

Those for whom Online banks are not suitable

If you are new to taking out a mortgage and would like to discuss various aspects of the process with an actual person, an online bank is not for you.
Taking out a mortgage is, for many people, the largest amount of money they will ever borrow in their lives.
And not many people have experienced this many times.
Although there are an increasing number of banks that allow you to consult with an online banker by phone or video call, it is not suitable for those who want to discuss various aspects of the application process with them.
Also, if you are unable to complete the application process on your own, online banking is not for you.
While interest rates are lower with online banks, you will have to complete the application process and other paperwork on your own.
If you are not good at working on a computer, or if you are not comfortable doing the unfamiliar mortgage loan procedures by yourself, we recommend that you go to a financial institution that will process your application over the counter.

In conclusion

In this issue, we have explained the differences and features of megabanks, regional banks, and online banks for those who are considering taking out a mortgage loan at a financial institution.
Each financial institution has its own characteristics, so it is important to get a mortgage loan at a place that suits you best.
Please refer to the information explained in this article to find the financial institution that best suits your needs.
** Many of the above Japanese financial institutions have specific requirements for foreigners such as visa status, employment history and Japanese language ability. Please consult with the financial institution regarding your specific situation.